How Obamacare is making it harder to find a full-time job

The drag Obamacare has had on the economy has been hard to quantify in the two-plus years since it became law, because so many of its economy- and job-altering provisions had yet to be written. But that’s changing, and the law’s negative impact on the economy is becoming clearer. The Washington Post’s Robert Samuelson explains one of the ways: the law’s exemption for part-time employees and its definition of what counts as “part time”:

In September, 34 million workers, about a quarter of total workers, were part-time, reports the Bureau of Labor Statistics (BLS). But the BLS defines part-time as less than 35 hours a week; Obamacare’s 30 hours a week was presumably adopted to expand insurance coverage. There are now 10 million workers averaging between 30 and 34 hours a week. To the BLS, they are part-time; under Obamacare, they’re full-time.

Employers have a huge incentive to hold workers under the 30-hour weekly threshold. The requirement to provide insurance above that acts as a steep employment tax. Companies will try to minimize the tax. The most vulnerable workers are the poorest and least skilled who can be most easily replaced and for whom insurance costs loom largest. Indeed, the adjustment has already started.

As first reported in the Orlando Sentinel, Darden Restaurants — owners of about 2,000 outlets including the Red Lobster and Olive Garden chains — is studying ways to shift more employees under the 30-hour ceiling. About three-quarters of its 185,000 workers are already under, says spokesman Rich Jeffers. The question is “can we go higher and still deliver a great [eating] experience.” The financial stakes are sizable. Suppose Darden moves 1,000 servers under 30 hours and avoids paying $5,000 insurance for each. The annual savings: $5 million.

Samuelson notes there are downsides for companies to have employees working fewer hours: The jobs may become less attractive, turnover may increase and, with it, training costs may rise. But the evidence clearly shows that even many employed Americans are still looking for more work because all they can find is part-time work.

In any case, his broader point, to which I subscribe, is that the economy isn’t strong enough — hasn’t been for a few years now — to withstand this kind of unnecessarily, artificially created uncertainty. Businesses always operate with uncertain market conditions, but they don’t need government adding to this uncertainty by passing laws that muddle the labor market — and thereby undermine the entire point of passing the law in the first place.

– By Kyle Wingfield

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164 comments Add your comment

Tiberius - pulling the tail of the left AND right when needed

October 22nd, 2012
11:13 am

Exactly, Kyle.

A store I help out in part-time just upped the hours needed to get benefits from 25 to 30 hours per week. Doesn’t affect me but there will be at least one employee per store in this chain losing their healthcare coverage.

Add to that, the penalties for employers to not cover employees are smaller than the cost to provide healthcare, and you’re going to see massive dropping of coverages in 2014 and beyond (except that President Romney will repeal the law and replace it with something that actually works).

catlady

October 22nd, 2012
11:20 am

And let’s forget about the fact that it is THE EMPLOYEES who do the work that makes the money for the company!

Ben

October 22nd, 2012
11:26 am

My buddy is starting a new business. He’s a hard core Obama guy, but now is whining because the new rules for small businesses significantly affect who he can hire. He said college kids looking for part-time jobs waiting and busing tables can forget it, there’s no place for them anymore.

More college debt, seems to be a good aim for Obama. That way even more young adults will be completely owned by the government.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
11:28 am

Seemed to work in Massachusetts ok.

kay

October 22nd, 2012
11:29 am

I call BS… just like when the gas rises, the companies give us the bill. We pay more for goods and services to cover the increase. (been grocery shopping lately?). The businesses will definitely NOT shoot themselves in the foot by hiring less employees, they will however pay the employee less in order to offset the additional cost. So yes, salaries will drop some, which is a problem, but at least get the PROBLEM right.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
11:31 am

The drag Obamacare has had on the economy has been hard to quantify in the two-plus years since it became law

BTW. Thats a very open minded way to open your article.

Halftrack

October 22nd, 2012
11:33 am

This is just the tip of the fiscalberg under Obummercare. Seniors with medicare etc. will be limited to Healthcare. Physicians of all stripes will be affected. Also Taxes will touch all of us in unintended ways. The less people work, the less that the unworking can be sustained, as well as taxes paid to the government. It is easier for 10 people to pay off a debt; than 7 or less people can get extinguish the same debt. It’s about jobs and taxes and our Country’s survival.

MarkV

October 22nd, 2012
11:34 am

According to Kyle, Obamacare is a bad program because it defines part time differently than BLS, and that makes some employers reduce the numbers of hours part time workers would be allowed to work. Repeal the law!

Is Kyle really incapable of finding a simpler way to fix that problem than to repeal the law, if this really becomes a problem?

Matz

October 22nd, 2012
11:37 am

Who pays for health care for people whose employers are too cheap to provide either a group plan or a wage that empowers people to afford health insurance? We do.

http://www.goodjobsfirst.org/corporate-subsidy-watch/hidden-taxpayer-costs

Biggest group of Peach Care recipients in Georgia? WalMart employees. Thanks, WalMart, for giving us low low prices by keeping your non-management workers under full time and ineligible to participate in an insurance program. Know who gets tons of FOOD STAMPS too? WalMart employees. (Save a buck on cheap garbage made in China so the Walton family can enjoy their $100 billion while we subsidize the cashiers’ dinner tables!)

Looking forward to the Rmoney plan of getting Americans back to work: Competing with foreign factories to which HE outsourced American jobs, by convincing American workers to give it their all for $10 a day and no access to decent medical care. Wooo-HOOOOO! Life is gonna be good when we got nothin’ left to lose, won’t it?

Finn McCool (The System isn't Broken; It's Fixed)

October 22nd, 2012
11:41 am

Matz, excellent points!

Just Saying..

October 22nd, 2012
11:42 am

“BTW. Thats a very open minded way to open your article.”

Fun-ney!

Finn McCool (The System isn't Broken; It's Fixed)

October 22nd, 2012
11:42 am

A store I help out in part-time

ummm, StarshipEnterprises?

mwuahahahaha

BW

October 22nd, 2012
11:44 am

What a sad state of affairs that we don’t want to give workers benefits in near minimum wage jobs that don’t work full time as it is. To me, 40 hours a week is full time but they were at 35 hours or less without benefits and now they will be under 30 hours a week without benefits. So if there aren’t already working two part-time jobs without benefits, they more than likely will be. Again these are not high paying jobs…what kind of jobs should we strive to create in this country? What is the endgame here? Is this really a good thing for the long term future of this country?

Finn McCool (The System isn't Broken; It's Fixed)

October 22nd, 2012
11:46 am

Employers will take advantage of the soft employment market – that’s a given. But as the economy improves and more people go back to work, needed workers will be in more demand and the labor market will get more competitive.

In the meantime, those healthcare-less employees will be using the emergency rooms and calling in sick more often.

People just need to keep adding to their skill sets and they will be among those in need.

Kyle Wingfield

October 22nd, 2012
11:47 am

Cheesy: This is an opinion blog. I am an opinion writer. I have written negatively about Obamacare many times before. Stop pretending you were expecting something else.

Matz

October 22nd, 2012
11:50 am

Flashback: “We’re not going to let our campaign be dictated by fact-checkers,” said Neil Newhouse, a Romney pollster.

Don’t know why I was just reminded of that.

BoneHead

October 22nd, 2012
11:52 am

Kay, the gas companies make about 8 cents a gallon on gas, our goverment makes twice that on a gallon of gas, so who are the greedy ones?

Cherokee

October 22nd, 2012
11:54 am

What Matz said.

Kyle Wingfield

October 22nd, 2012
11:54 am

kay: Well, if they “will definitely NOT” do that, we have to ask: Why are some of them doing it now?

Maybe because few companies have the kind of pricing power to make your theory work in practice.

JDW

October 22nd, 2012
11:56 am

Talk about reaching for straws…in the year ended this past May Darden had revenue of about $8 billion and EBIT of $638 million…do you really think they will risk the service levels to save $5 million? My guess is they will study and do nothing new.

On the other hand if you are worried about penny ante decisions you make a great case for removing the employer from the equation completely. Of course the way to do that would be a public option as does the rest of the economically advantaged world.

td

October 22nd, 2012
11:56 am

Let us not forget that if you sell your house after Jan. 1 you will pay a 3.8% Obamacare tax on the sell.

Kyle Wingfield

October 22nd, 2012
11:56 am

MarkV: Since it’s so obvious to you, please, share with us.

Kyle Wingfield

October 22nd, 2012
11:59 am

Matz @ 11:37: So, please, explain why you would expect employers to react in any way other than this? How was Obamacare ever going to work when the disincentives for providing health insurance were so obvious?

Oh, and btw: If it doesn’t work, guess who’s still paying for the uninsured? We are. So what problem does it solve?

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
11:59 am

Cheesy: This is an opinion blog. I am an opinion writer. I have written negatively about Obamacare many times before. Stop pretending you were expecting something else.

I wasn’t.

The point was to make sure people know you aren’t objective.

Your mind is made up on this issue right or wrong.

I think you are wrong and so does the rest of the free world that enjoys Universal Healthcare.

Matz

October 22nd, 2012
12:00 pm

“Let us not forget that if you sell your house after Jan. 1 you will pay a 3.8% Obamacare tax on the sell.”

Let’s not forget that the 3.8% is only applied to the amount of the sale AFTER the first $250,000 (or $500,000 for married couples.) That being said, if you can sell my house for $251,000, I’ll kiss your behind and give you thirty minutes to draw a crowd.

Tiberius - pulling the tail of the left AND right when needed

October 22nd, 2012
12:01 pm

According to MarkV, writing about just one of so many issues with Obamacare is worthy of belittling the point Kyle is trying to make, completely forgetting that the other issues are still there with which to make the case for repeal.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
12:01 pm

Let us not forget that if you sell your house after Jan. 1 you will pay a 3.8% Obamacare tax on the sell.

Not factual in any way.

http://blogs.rgj.com/factchecker/2012/06/17/obamacare-sales-tax-on-houses/

Kyle Wingfield

October 22nd, 2012
12:02 pm

“Your mind is made up on this issue right or wrong.”

As is yours, Cheesy. My blog is clearly labeled “opinion.” Maybe you should issue a disclaimer for yourself.

iggy

October 22nd, 2012
12:03 pm

Yes…OBlunder and OBlundercare are wrecking havoc and we are seeing only the tip of the iceberg.

Kyle Wingfield

October 22nd, 2012
12:04 pm

JDW @ 11:56: Yes, then we can simply shift the collection of health premiums from the employer to the tax man, and push total federal tax rates into the 40s or 50s. Which, of course, is how it’s done in the rest of the economically advantaged world.

adam smith's invisible hand

October 22nd, 2012
12:07 pm

Vote for Romney. Then, if you have a child that’s born with some sort of health problem, your employer can fire you and get your expensive behind off the company’s health insurance plan. You won’t be able to find insurance at an affordable cost anywhere else, but maybe you have some family members you can call on willing to mortgage their homes to help pay for care. Or, you could just let the kid die. I mean, at least you wouldn’t be guilty of getting an abortion (and you won’t be able to get one of those if Romney wins).

adam smith's invisible hand

October 22nd, 2012
12:09 pm

Also, if Romney wins, my fellow seniors better get ready to give up Medicare and get a voucher instead. We’ll see how well that works.

cc

October 22nd, 2012
12:10 pm

ObamaCare is not and never was about healthcare. Obama, Pelosi, Reed and company don’t give a rat’s rear end about anyone’s health. This legislation was and is about GOVERNMENT CONTROL, and more specifically about DEMOCRAT CONTROL.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
12:11 pm

Kyle

Do you know what the top tax rates were under Eisenhower?

If you said 91 percent you would be right.

http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=213

Seems to me we have been lowering taxes on the rich for quite some time now. Still waiting for that trickle down effect.

Meanwhile our debt has exploded.

Coincidence ???

Tiberius - pulling the tail of the left AND right when needed

October 22nd, 2012
12:11 pm

adam smith could apply to the Obama campaign as Stephanie Cutter’s replacement.

He doesn’t know Romney’s stances any more than she does.

td

October 22nd, 2012
12:11 pm

Kyle Wingfield

October 22nd, 2012
12:04 pm

JDW @ 11:56: Yes, then we can simply shift the collection of health premiums from the employer to the tax man, and push total federal tax rates into the 40s or 50s. Which, of course, is how it’s done in the rest of the economically advantaged world.

Do not forget those VAT’s added on a Federal level in a great deal of the world in addition to those higher tax rates.

adam smith's invisible hand

October 22nd, 2012
12:11 pm

Kyle “Which, of course, is how it’s done in the rest of the economically advantaged world.”

Well, I sure wouldn’t want us to be like the rest of the economically advantaged world. I think we ought to have a system more like the third world country we’ll become if Romney gets elected.

adam smith's invisible hand

October 22nd, 2012
12:12 pm

Tiberius – nobody knows Romney’s stances. They’re all over the map. We do know the GOP platform, however.

Tiberius - pulling the tail of the left AND right when needed

October 22nd, 2012
12:13 pm

“Meanwhile our debt has exploded.

Coincidence ???”

No, just gross mismanagement and unchecked spending at the Federal level, Cheesy.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
12:14 pm

Also, if Romney wins, my fellow seniors better get ready to give up Medicare and get a voucher instead.

Thats why I cant imagine Florida going to Romney.

Those Seniors are going to get out and vote and when they get into that booth Romney is going to scare them right back to Obama.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
12:15 pm

No, just gross mismanagement and unchecked spending at the Federal level, Cheesy.

Mostly by Republican Administrations.

Reagan quadrupled the national debt.

Drudge

October 22nd, 2012
12:16 pm

Cheesy – now run that stat next to the graph that shows medicare, medicaid, education, SS and DOA public assistance and see if you see a stronger correlation…

Plain and simple – Obama’s tax hike on the wealthy would be $500BN amortized over a decade – let’s say $50BN/year. That is 4% of Obama’s deficit spending alone. Doesn’t even touch the debt. If it WAS applied to the national debt – it would be .03%. That’s Obama’s plan. .03%. Or…4% towards his pet projects – doesn’t even cover what we lost in 30 something green energy loans we have lost lately.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
12:18 pm

He doesn’t know Romney’s stances any more than she does.

Or any more than Romney does for that matter.

They call him Multiple Choice Mitt for a reason.

Tiberius - pulling the tail of the left AND right when needed

October 22nd, 2012
12:18 pm

“Tiberius – nobody knows Romney’s stances.”

He does. I do.

“They’re all over the map.”

No, they are not. Only in the so-called “minds” of people who use DNC talking points and slate.com as their sources of information.

“We do know the GOP platform, however.”

And we know that there is not a single nominee in the history of American politics who believes in their party’s platform 100%.

td

October 22nd, 2012
12:18 pm

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
12:14 pm

Also, if Romney wins, my fellow seniors better get ready to give up Medicare and get a voucher instead.

Thats why I cant imagine Florida going to Romney.

Most of your fellow seniors do not believe you because Florida is a Romney state now. FL, NC, and VA are all Romney and the Obama campaign knows it and will not even visit in the next couple weeks. The election is down to OH, Wis, IA, CO, NH and NV.

Tiberius - pulling the tail of the left AND right when needed

October 22nd, 2012
12:19 pm

“Thats why I cant imagine Florida going to Romney.”

And yet, internal polling by both campaigns shows Florida going Romney. Too bad for you, Cheesy.

JDW

October 22nd, 2012
12:21 pm

@Kyle…”Yes, then we can simply shift the collection of health premiums from the employer to the tax man, and push total federal tax rates into the 40s or 50s. Which, of course, is how it’s done in the rest of the economically advantaged world.”

It’s just that kind of myopic wrong headed thinking that keeps our per capita health care costs the most expensive in the world…

US…$7690
Canada…$4363
Germany…$4218
France…”$3978
UK…$3487

Psst…we spend more…single payer would REDUCE our expenditures while freeing business to concentrate on more important problems than how to game health insurance costs.

Tiberius - pulling the tail of the left AND right when needed

October 22nd, 2012
12:22 pm

” No, just gross mismanagement and unchecked spending at the Federal level, Cheesy.

Mostly by Republican Administrations.”

Not true, Cheesy. CONGRESS is primarily responsible for spending. And our debt has increased 52% during Democrat-controlled Congresses and 48% GOP-controlled Congresses.

So they are BOTH to blame.

adam smith's invisible hand

October 22nd, 2012
12:23 pm

Tiberius – congratulations on being able to read Romney’s true intentions. Sorry, but I don’t believe in ESP or mind readers. I’ll go on the GOP platform’s statements and the history of all his advisors, plus what he says when he’s talking to his base supporters. You mind readers ought to go to Vegas and try to make your fortunes. Whatever you do, however, don’t invest in the stock market of the US if Romney gets elected. Stocks up over 60% under Obama – Down over 25% under the last GOP guy. Maybe you can get your winnings to the Caymans, should your clairvoyance prove real.

I demand to see Cheesy Grits Birth Certificate- Long Form Please

October 22nd, 2012
12:23 pm

Too bad for you, Cheesy.

Not really. Obama is going to win Ohio.

And that puts Romney in a real bad place. He would have to run off all the tossups after that.

Romney might get close. He might even win the popular vote.

But he will never be President.